It is a known fact that in case there is no employee in Company FBT cannot be levied however I have following two queries and sought expert views on the same :
1. Will a Company be held liable for FBT on expenses {of the type covered by Sec. 115WB (2)} in case it has just one employee on the rolls of the Company?(as the definition used says "Company should have employees in India"
2. The Company has incurred some expenses which are liable for FBT but didn’t had any employee. Subsequently it appoints one/two employee in the Company. Whether FBT will be levied on the expenses {of the type covered by Sec. 115WB (2)} incurred from the date the employee joins the organisation or from the first date of the financial year?
13 March 2009
Even if one employee is there then FBT will be attracted.
If no employee is there at the time of spending the expenditure then that expenditure will not attract FBT. But if no employees are there to whom this expenses has been spent will be question of ITO which you should be in a poistion to answer.
Thanx for your advice, I hope Directors of the Company are not considered as Employees for the purpose of FBT. So if Director of a Company making an expense in the nature of for example Entertainment Expense I think it will not attract FBT.
CAclubindia
